Fiscal cliff talks heat up

A jolt of reality is rippling through the Capitol as discussions over how to solve the so-called fiscal cliff are suddenly swinging into action.

Leaders on both sides of the dome, in both parties, are meeting with key Obama administration officials on Capitol Hill, quietly mulling different legislative strategies to avoid massive tax hikes on all Americans. At the same time, lawmakers are beginning to carve out positions for their parties for what will become a months-long rhetorical and legislative war leading up to a series of year-end deadlines.

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In one day, Treasury Secretary Timothy Geithner met with both House Speaker John Boehner (R-Ohio) and House Ways and Means Chairman Dave Camp (R-Mich.). The meeting with Camp was directly focused on the year-end expiration of tax rates — widely known in Washington as the “fiscal cliff.” Boehner’s office said he and Geithner spoke about the European debt crisis, but it declined to answer whether tax rates were dicussed.

Meanwhile, House Republican leadership — which is all but certain to control the lower chamber next Congress — has begun privately mulling different electoral outcomes and legislative scenarios they would present, according to multiple sources familiar with the discussions. The Ways and Means Committee will meet Thursday in a rare bipartisan, closed session to discuss unfinished business.

In reality, nothing substantive can be done until Nov. 7, after the country selects a president and decides on the composition of Congress. But the sessions are akin to a crash course — a way for lawmakers to get armed with details before the battle.

“Frankly, if I wasn’t meeting with the secretary, I think there’d be an issue,” Camp said Wednesday morning. “It’s important we try to do our work, and that’s what I’m trying to do.”

The range of scenarios vary widely, and that — in part — explains the flurry of activity. There are several scenarios that Congress could face come mid-November. Mitt Romney has said he wants to extend tax rates for everyone, and President Barack Obama said he would allow rates for married couples making more than $250,000 to snap back to 39.6 percent — where they stood for much of the 1990s.

If the polls stay where they are today, and Republicans keep the House, Democrats hold the Senate and Obama wins the presidency, top aides in both parties insist that tax rates on the wealthy will go up. But those aides, who are involved in planning for the year-end battles, say the legislative gridlock could give both sides the incentive to strike a grand deficit and tax compromise.